Dáil Éireann Debate, Wednesday - 9 July 2008
250 Deputy Catherine Byrne asked the Minister for Social and Family Affairs if she will increase the fuel allowance in view of the recent increase in fuel costs here; and if she will make a statement on the matter. [27798/08]
View answer251 Deputy Catherine Byrne asked the Minister for Social and Family Affairs if she will make the fuel allowance available all year round in view of the cold and wet weather being experienced here during the summer months; and if she will make a statement on the matter. [27799/08]
View answerI propose to take Questions Nos. 250 and 251 together.
This Department's role is to assist social welfare recipients with heating costs, both through their basic payments and through the household benefits package with fuel, electricity and gas allowances. These schemes have been improved significantly in recent years.
The national fuel allowance scheme assists householders on long-term social welfare or health service executive (HSE) payments with meeting the cost of their heating needs during the winter season. The allowance represents a contribution towards a person's normal heating expenses. It is not intended to meet those costs in full. Fuel allowance is now payable for 30 weeks and benefits over 290,000 people at an aggregate cost of €170 million this year. The payment rate has increased to €18 per week or €21.90 for recipients living in designated smokeless areas; this is a doubling of the rate of payment since 2005.
Electricity and gas allowances under the household benefits package, are payable throughout the year to over 355,000 pensioners, people with disabilities, and carer households towards their heating, light and cooking costs at an estimated overall scheme cost of €159m in 2008. The electricity allowance covers standing charges plus VAT and up to 2,400 units of electricity in each billing period, increased from 1,800 units in January 2007. The gas allowance covers a cash equivalent amount.
The supplementary welfare allowance scheme can also be used to assist people in certain circumstances with specific heating needs due to infirmity or a particular medical condition.
Fuel allowance is incorporated into a person's weekly social welfare payment. Government policy in recent years has focused on significantly increasing primary social welfare rates to ensure that people on social welfare can meet their basic living costs, including heating, throughout the year and achieve an improvement in quality of life. This is a more costly approach than increasing fuel allowance as the increase is paid for the full year and not just for the 30 weeks of the winter heating season. Social welfare rates have increased at a significantly greater rate than inflation in recent years. Since December 2001, the consumer price index has increased by over 27% while energy product prices have increased by 65%. However, increases in social welfare payments (including fuel allowance) have been between 71% and 88% in the same period.
Improvements to the fuel allowance scheme, such as an increase in the rate of payment or an extension of the duration of the fuel season, would have considerable cost implications. Payment of the fuel allowance for a full 52 weeks of the year would cost an additional €123m, bringing total annual expenditure to over €293m. Any changes to the scheme will be considered in a budgetary context and in the light of resources available for improvements in social welfare payments generally.
